1. Managers need to identify the risk taking tendencies of individual
members of staff and the influence of those preferences on teams
and the culture of the organisation.

5. The PCL research reported here builds on consensus personality
psychology, accessing decades of research into the roots of our
nature and common heritage.

2. The probability and magnitude of risk are not precisely knowable.
One person’s risk is another person’s opportunity, excitement,
responsibility or path of righteousness.

6. The Risk-Type CompassTM focuses on risk related themes
extracted from the taxonomy of the whole personality, placing
individuals within a continuous spectrum of eight Risk Types.

3. We do know, however, intuitively and objectively that people differ
in their temperament, and that such differences are deeply rooted.
Personality research offers a point of entry into an understanding
of human factor risk.

4. The distinction between Risk Type and Risk Attitude separates the
transient influences of circumstances and experience, from the
persistent influence of temperament.

WHY ARE WE MEASURING IT?
8. The Risk-Type CompassTM makes an individual’s propensity for risk
visible and accessible for management and for strategic planning
at all levels within the organisation.
9. It allows the deployment of high and low Risk Types into appropriate
roles and makes it possible to chart and monitor the Risk Type
landscape of teams and organisations.
10. It facilitates the self-awareness necessary for accurate evaluation
of risk propensity of others. Arguably, the greatest potential risk
exposure for an organisation lies in a lack of risk self-awareness
at the top.

INTRODUCTION
This report describes some important
findings from PCL’s three year research
program into the assessment of individual
propensity for risk; an agenda that is ongoing
and open ended. Current projects involve
groups as diverse as fire fighters, auditors
and extreme sport enthusiasts.
By focusing on the well researched area of personality
assessment, we have found an entry point into the
complexities of risk that is itself robust and informative, but
which also provides a platform to support future progress.
Whether or not someone is comfortable with risk will
be one of their most distinctive characteristics. This is
significant because any job involves risk of some kind.
Any creative, enterprising or entrepreneurial role, or
any role that seeks to influence or compete with others,
exposes that individual to the risk of failure, as well as
the possibility of success.

The difficulty for managers and recruiters is that
appetite for risk is not visible. Furthermore, risk taking
may appear inconsistent from one situation to another
and over time, sometimes varying quite dramatically.
How can we make sense of all this?
The task of defining risk in any objective, scientific and
measurable way has perplexed many talented people.
But, while risk is a topic of labyrinthine complexity, our
fears and anxieties about risk are all too tangible and
distressing to those left exposed by them. However, as
John Adams (1995) points out, what we broadly define
as risk in everyday life is unquantifiable; probability and
magnitude are not precisely knowable. One therefore has
to find “useful aids for navigating the sea of uncertainty”.
The management of risk has tended to emphasise
processes, procedures, regulation and legislation on
the one hand, and accident statistics and probabilities
on the other. Any questions about the personalities of
risk takers seem to have been rapidly assigned to the
‘too difficult’ basket.

Our research suggests that, at the level of personality,
individual propensity for risk is knowable. People can
be managed in ways that maximise their contributions,
whether as adventurous or cautious risk takers. Teams
can be balanced appropriately. Awareness of, and
appreciation for, these individual differences can inform
decisions at the individual, team and corporate levels.
Those at the top of the corporate pyramid have the
privileges of leadership and the responsibilities of
influence. The proper management of risk is ultimately a
matter of corporate governance. Any misunderstandings
about individual propensity for risk taking will have
their greatest impact at board and senior management
levels and this is where advances in the understanding
of human risk will yield their greatest return.

Part 1:

THE
RISK TYPE
COMPASS
TM

The policy
of being too
cautious is
the greatest
risk of all
JAWAHARLAL NEHRU

PART 1: THE RISK-TYPE COMPASS TM

ABOUT THE RISK-TYPE COMPASS

20%
20%

FINANCIAL
RECREATIONAL

20%
20%

HEALTH & SAFETY
SOCIAL

20%
20%

RECREATIONAL

20%

Int
e

d

20%

ETHICAL
HEALTH & SAFETY

ef

se

FINANCIAL

re

r

RISK ATTITUDE

20%

Deliberate

CHART 1: Risk Attitudes
ETHICAL

Pr
u

e
ns

Typical
Typical

Ca

Firstly, the Risk-Type CompassTM assessment places
individuals in to one of eight Risk Types. Their Risk
Type reflects their temperament and natural disposition
towards risk – the extent to which they are, for example,
naturally adventurous and optimistic as opposed to
being cautious and anxious about uncertainty, or to
what extent they plan things carefully, seek excitement
or act on impulse. Temperament is deeply rooted and
will influence how much risk an individual is able to take,
how much uncertainty they can cope with and how they
react when things go wrong.

Thirdly, Risk Tolerance, is determined mainly by natural
temperament, which establishes a baseline for reactivity
to any kind of risk or uncertainty. Experience and personal
circumstances also influence behaviour, but in less
predictable ways. The RTi (Risk Tolerance Index) is a
single numeric score that takes both factors into account.

po

RISK TYPE

Wary

RISK TOLERANCE

nt
de

The Risk-Type CompassTM explores an
individual’s predisposition to risk and their
capacity to manage it.

FIGURE 1: The Risk-Type CompassTM

TM

Spontaneous

06

Co

e

m

A d v e n t u ro u s

FIGURESOCIAL
2: Risk Tolerance
Index (RTi)
20%

Secondly, an individual’s Risk Attitude will typically vary
from situation to situation due to personal experience and
circumstances. The Risk-Type CompassTM uses ipsative
assessment to identify individual differences in risk attitude
across five important risk domains: ethical, financial, health
and safety, recreational and social.

0
VERY LOW

10

20
LOW RISK

30

40

50

60

MEDIUM RISK

COMFORT ZONE

70

80
HIGH RISK

90

100
VERY HIGH

PART 1: THE RISK-TYPE COMPASS TM

07

RISK TYPES
WARY (Very Low Risk Tolerance)

COMPOSED (High Risk Tolerance)

SPONTANEOUS (Average Risk Tolerance)

The Wary Type is cautious, vigilant and pessimistic,
and security is always high on their agenda. They will
be alert to the risk element of any idea or innovation
and dubious about the benefits. Such people have a
need for certainty and like to know precisely what they
can expect. Fearful of failure, they protect themselves
by being conservative, prudent and organised. They
should have a respect for convention and tradition and
prefer change to be gradual.

This type will always be relatively untroubled, and more
even-tempered than most. They seem to take whatever
life throws at them and maintain a positive outlook. The
Composed Type manages stress well, rides out any
turbulence and stays on-task. Not reckless, but not
averse to risk either, this type keep their nerve and see
things through.

The Spontaneous Type is emotionally expressive and
reacts strongly to events. The spontaneity of ‘on the
fly’ decisions will always appeal to the excitable side of
their nature, but they are also prone to anxiety if things
go wrong. High hopes and expectations, combined
with a tendency to act hastily risk a cycle of highs and
lows in which disappointing outcomes lead to remorse
and self-criticism.

PRUDENT (Low Risk Tolerance)
The Prudent Type will be conservative and conventional
in their approach, people that prefer predictability
and continuity to change or variety. They are most
comfortable ‘doing things by the book’ and operating
within established and familiar procedures. Such people
prefer change to be gradual and evolutionary rather than
radical. Comparatively resilient and unsentimental, this
type is careful and provident.

DELIBERATE (Average Risk Tolerance)
This type will be self-assured and even-tempered.
However, because they are highly organised, compliant
and well informed about what is going on, they are unlikely
to walk into anything unprepared. Any aversion to risk will
be practical rather than emotional, a desire to do things in
a balanced, sensible and systematic way. This type is not
unnerved by radical or extreme proposals, but evaluates
them precisely before giving their view.

ADVENTUROUS (Very High Risk Tolerance)
This type is resilient and attracted by excitement. They will
be open to new experiences and will deal unemotionally
with disappointments and unexpected turns of event.
Their positive, upbeat outlook, and desire for stimulating
challenges allows them to pursue their adventures with
equanimity. Not particularly well organised or prudent,
their decision-making is likely to be influenced by both
lack of anxiety and impulsiveness.

CAREFREE (High Risk Tolerance)
The Carefree type welcome variety and value their
independence and personal autonomy. Not highly
methodical but easily diverted to new interests they may
not always seem very focused. They are at their best in
fast moving situations or when on personal missions
that provide a clear sense of direction. Although not
naturally methodical or attentive to detail, this type will
provide a challenge to dogma and relish opportunities
to break new ground.

INTENSE (Low Risk Tolerance)
The Intense Type wear their hearts on their sleeves;
they are enthusiastic, sincere and involved with people
and projects at a personal level. Self-doubt makes
them their own most unforgiving critic but it often
fuels their drive and determination to succeed. Neither
particularly cautious nor impulsive, this type will be less
resilient than most but generous in their passion and
their commitment.

08

PART 1: THE RISK-TYPE COMPASS TM

RISK TYPE & RISK ATTITUDE
THE ESSENTIAL DISTINCTION
Making the distinction between deeply rooted personality
characteristics (Risk Type) and the many transient
influences on risk taking (Risk Attitude) has been a major
step in our understanding of human factor risk and the
development of the Risk-Type CompassTM rationale.
An extensive review of the relevant literature presented
us with two contradictory pictures. Firstly, the view of risk
taking as a relatively stable aspect of personality. Secondly
and conversely, the view that risk taking is inconsistent,
situationally determined and inherently unpredictable.
In the first of these scenarios, research presents a
consensual view about the scope and structure of
personality assessments in the form of the Five Factor
Model (FFM). This structure has been replicated across
cultures, remains stable and consistent over an adult
working life and has been shown to be a predictor of
work place behaviour and success, particularly over
the long term. Additionally, twin studies and genome
research support the view that personality has significant
genetic roots. Also, the vocabulary associated with
FFM personality is permeated throughout by risk
related elements or themes. All encouraging signs for a
personality based assessment of risk taking.

On the other hand, observations about the apparent
inconsistency of risk behaviour have provided a
major argument in favour of a ‘situationalist’ view.
This suggests that any variations in risk taking are
accounted for by circumstances and situations, rather
than by personal variables.
So, is it possible to reconcile these two views?
The diagram opposite accepts both views and illustrates
our understanding of the relationship between personality
(Risk Type) and more transient influences (Risk Attitude).
Personality establishes the reference point around which
the variability of day–to-day behaviour is anchored. The
boat in our analogy may be blown one way or another by
the wind, may rise and fall with the tide, may be pitched
and tossed by the waves but there is a defined point
around which these variations are constrained. Similarly,
circumstances, experience and the behaviour of others
all influence one’s decisions and actions, typically on an
immediate and short-term basis, but always under the
persistent influence of personality.

In distinguishing a clearly defined concept of Risk Type
from the uncertainties of Risk Attitude we have been
able to isolate something measurable and predictable
from the complex totality of risk taking. However,
there is a level of influence on behaviour that may be
unknowable. Attitudes to risk will be influenced by a
kaleidoscopic range of incident, personal history,
chance and circumstance that is highly individual,
idiosyncratic and beyond any known organising
principle. It is not very surprising then if there are still
some things that we cannot know about risk taking. But
it is very encouraging that some things can be known.
In our view, this is an essential distinction.

PART 1: THE RISK-TYPE COMPASS TM

RISK ATTITUDE

RISK TYPE

09

Part 2:

RESEARCH
FINDINGS

Only those
who will risk
going too far
can possibly
find out how
far one can go
T. S. ELLIOT

PART 2: RESEARCH FINDINGS

RESEARCH FINDINGS
This report discusses the results
from studies within occupations
and professions in which issues
of risk and risk management are a
defining feature, whether in terms of
the need to be comfortable with, or
wary, of risk. Twenty such surveys
have been completed, involving
almost 2,000 individual assessments
across four continents, with data on
a wide range of occupations. Global
studies of fire fighters, miners and
auditors are in progress.

In this section of the report we present
our findings of Risk Types within the UK
workforce, amongst different sectors, across
generations and job levels. In addition,
we summarise findings of four contrasting
studies: Engineering, Information Technology,
Auditing and Recruitment. Our purpose is to
illustrate the effectiveness of the Risk-Type
CompassTM in differentiating between sectors
or industries and, at the survey level, capturing
distinctive features that will contribute to the
risk climate of those organisations.

THE UK WORKFORCE
Our UK working population sample included individuals
across various industries and age groups, and at a
variety of levels of seniority and expertise.

DIFFERENTIATION
The specific studies described in this report demonstrate
that the Risk-Type CompassTM is able to differentiate very
clearly between the risk characteristics of individuals as
well as between teams, professions, organisations and
sectors and even generations.
The technical blue-print for the Risk-Type CompassTM, the
definitions, the scaling and the normative approach, all
enshrine the ideal of an equal prevalence of each of the eight
Risk Types across the population as a whole. A number of
statistical factors could potentially have undermined this
intention but the analysis of the total sample presented
in Charts 2 and 3 show how far our results support our
expectation of Risk Type equality. The variation from the
ideal ranges are between -2.7 and +0.3 percentage points.
Our total sample of 2000 administrations of the Risk-Type
CompassTM therefore provides a sound basis for Risk Type
comparisons at many levels.

DISTRIBUTION

THE ‘TYPICAL’ GROUP

The distribution of Risk-Type Compass
scores
across the workforce (the proportion of scores that are
high, average or low) is particularly important when
interpreting test scores. The bell shaped curve of the
‘normal distribution’ is typical of the variation of many
natural phenomena and is commonly the presumed
ideal distribution in this kind of investigation.
TM

Figures 3 and 4 show the distribution of scores for the
two underpinning scales obtained from our original
research – extended to include the total sample. Our
data for both scales conforms well to the normal curve
and satisfies all statistical requirements in this respect.

GENDER
The gender differences demonstrated here (Chart 4) are
significant and appear to amplify gender differences
already familiar in personality research. Since, for the
development of the Risk-Type CompassTM, we trawled
the total personality domain to extract all the risk
related themes, this suggests that differences in risk
taking may be a distinctive feature of gender. In itself,
this is an interesting finding that may contribute to more
focused discussions about gender and occupational or
cultural preferences.

Throughout our sample data there are cases of individuals
who show none of the Risk Type characteristics sufficiently
to characterise them specifically as one Risk Type or
another. These are people who fall close to the mean
score on both of the underlying measurement scales. In
terms of their location on the compass, they are clustered
within the centre circle. We refer to this group as ‘Typical’
rather than any particular type. 10.6% of our sample are
categorised as Typical, as shown in Chart 3.
The most distinctive feature of the Typical group is
that they show none of the extremes that characterise
other Risk Types. So far as personality and risk
tolerance are concerned, they are unexceptional and
similar to most other people - neither exceptionally
well organised or unusually excitement seeking, nor
particularly fearful or imperturbable.
For this reason, the RTi (Risk Tolerance Index) of the
Typical group will always be in the mid-range.

PERCENTAGE OF SA

THE RESULTS
INCIDENT
FORthat
TOTAL
Analysis
revealed
thereSAMPLE
is a fairly even spread
of Risk Types across the general population.

The different personality elements present in the Risk-Type CompassTM are grouped into two conceptually
RISK TYPE of these two scales meet the distribution
scales,
informing
the structure
of the tool. The properties
CALM:
EMOTIONAL
SCALE
CALM:orthogonal
EMOTIONAL
SCALE
DARING: MEASURED DARING:
SCALE MEASURED
requirements for normality, as demonstrated by the symmetrical bell shaped curve.

RISK TYPES ACROSS THE GENERATIONS
THE RESULTS
We examined the risk taking propensity and attitudes
towards risk in three different generations.
Baby Boomers: Born 1943-1960
Generation X: Born 1961-1981
Generation Y: Born 1982-2001

GENERATION Y
Three neighbouring Risk Types; Prudent, Deliberate and
Composed, account for the highest proportion of Risk
Types in Generation Y and give a very distinctive shape
to their data. These neighbouring Risk Types seem to
define the ‘centre of gravity’ of risk taking for people of this
generation. The most prevalent is the Deliberate Type. These
are people who are not unnerved about risk taking but have
a very careful and measured approach. They combine a
calm self-confidence with being thorough, systematic and
organised, characteristics that are represented separately
by the Prudent Type and the Composed Type. These too
are prevalent amongst the Y generation. The Adventurous
Type is also well represented.

Least frequent in Generation Y are the Spontaneous,
Carefree and Intense Risk Types, with a much lower
incidence than either Generation X or the Baby Boomers.
This suggests that fewer in the Generation Y sample are
likely to make hasty, unplanned decisions, and fewer are
likely to be emotional in their decision-making or to be
‘edgy’, anxious, pessimistic or self-doubting. As in our
previous survey research (Trickey & Hyde, 2009), it is
Generation Y data that has the most distinctive shape.

GENERATION X
Our Generation X sample is more evenly spread across
Risk Types than Generation Y or the Baby Boomers,
and is also generally less extreme. The only Risk Type in
which there is a higher proportion of Generation X than
the other two generations is the Adventurous Risk Type.
This Risk Type is enthusiastic, unflappable and intrepid.
They enjoy being on the leading edge and they keep
their nerve.

BABY BOOMERS
The highest proportion of the Baby Boomers fall into the
Wary and Spontaneous Risk Types. These two types
overwhelm the Adventurous and Deliberate Types,
their respective opposites on the compass. The Baby
Boomers also have a greater overall representation of
these two types than either of the other two generations,
so these will be qualities that characterise them most
distinctly. As a group then, Baby Boomers are most likely
to be cautious. Anxious about risk and having a strong
need for security, they will be methodical in their approach
and display a shrewd and persistent scepticism. Apart
from these distinctions, each Risk Type is fairly evenly
balanced with its opposite; Prudent with Carefree and
Intense with Composed.

In our earlier research into generational differences looking
at a much broader sweep of personality characteristics
(Trickey & Hyde, 2009), we characterised Generation
Y as less confident and less assertive than either
Generation X or the Baby Boomers, but cooperative and
eager to please. Generation X we described as at the
peak of their social skills, competitiveness and drive and
the Baby Boomers as being more easy going, generous
and comfortable in their skin.
This report taps into somewhat different territory and
should be considered as complimentary rather than as
providing a contrary perspective. The three generations
still show quite distinctive differences from each other
and, once again, it is the Generation Y sample that has
the most distinctive pattern. Optimistic and compliant at
the beginning of their careers, their risk profile seems
to map quite neatly into the earlier findings. Generation
X seem to fall between the two and WARY
to be the least
25is an interesting
differentiated. The Baby Boomer sample
INTENSE
PRUDENT
20
combination of Spontaneous and Wary
Risk Types,
15
perhaps polarising towards the end 10
of their careers
as increasingly apprehensive
and anxious
about the
5
WARY
SPONTANEOUS
0
state of the world,
but
also
more
impulsive
–
the ‘shoot DELIBERATE
25
INTENSE
PRUDENT
20
from the hip’ combination
of Larry David in ‘Curb Your
15 notorious grumpy old men and
Enthusiasm’ and the
10
women of UK media fame?
CAREFREE
COMPOSED
SPONTANEOUS

COMPARING PRIVATE AND PUBLIC SECTORS
The public sector faces redundancies of around 7.8%
according to Labour Market Outlook (CIPD). Any business
recovery over the next few years has to be offset by the
600,000 public sector job losses predicted by the Office
for Budget Responsibility - the onus being on the private
sector to create the vacancies needed. But the tendency
to classify employees from the two sectors very differently
questions the feasibility of such a trade off.
The typical perspective of the public sector implies a
higher degree of formalism and bureaucracy leading
to the perceived expectation that any opportunity for
risk taking is restrained by ‘red tape’. When asked to
describe each other, over two-thirds of staff working
in the public sector agreed with the stereotypical view,
concurring that they could be described as risk averse.

A study by Van Keer and Bogaert (2009) involving
1,000 senior leaders in the public and private sectors in
Europe, confirmed that differences between private and
public sectors do exist. Public sector leaders were more
focused on long-term strategy. They were more inclined
to “control” than to trust, less optimistic, and more
thoughtful and risk-averse in their approach. Private
sector leaders had short-term objectives and were
prepared to take risks looking for quick results. They
showed more belief and trust in their management style,
and offered younger managers more opportunities.

PCL research,
published in 2009,
found that private
sector employees were
more likely to have
fresh ideas and suggest
innovative solutions
to problems than
their public sector
counterparts.

Numerous other studies have confirmed that those
less willing to take risks were more likely to be found
in the public, than private sector (Bellante & Link, 1981;
Luechinger et al, 2007; Pfeifer, 2008).
The issue of risk taking is central to these discussions,
and it seems reasonable to question how well suited
public sector employees will be to fill jobs becoming
available through private sector growth.

Attitudes to risk and to
security in these two sectors
were very different; the private
sector seeing a need to take
greater risk whilst the public
sector needed to be more
prudent and conservative
to ensure that public affairs
were managed responsibly.

PERCENTAGE OF SAMPL

PART 2: RESEARCH FINDINGS

RISK TYPE

THE RESULTS

PRIVATE SECTOR

Our results show distinct differences between the public
and private sectors. The first distinction is that there is
considerable variation of Risk Types within the public
sector, while the private sector data shows a relatively
even distribution across all the Risk Types.

The data also revealed a higher incidence of the Carefree
Risk Type in the private sector sample compared with
public sector employees. At the root of this Risk Type are
high levels of spontaneity, challenge to convention and a
preference for novelty and excitement over routine. These
individuals are likely to favour variety over consistency,
excitement over caution, action over planning and
individuality over conformity, and may easily feel
constrained by rules, traditions or micro-management.

PUBLIC SECTOR
The first distinction between sectors is that there is a very
clear differentiation of Risk Types in the public sector,
from a small percentage of the Carefree Type (2.2%) to
a high percentage of the Deliberate Type (23.3%). This
differentiation is highly systematic, with the Prudent and
Deliberate Types pulling the distribution in that direction.
These results suggest that public sector employees are
more likely to be conventional, less flexible and to prefer
working within familiar, established procedures. They
are likely to be highly compliant and approach risk in a
cautious and calculated manner. Significantly, all three of
the most risk tolerant Risk Types are under-represented
in the public sector.

The private sector also has a higher incidence of the
Adventurous Type than the public sector. This suggests
that they are more optimistic, impulsive and fearless
and excited by new experiences, but less likely to
favour custom, tradition or convention.

The greatest discrepancy in these results is in the
incidence of the Intense Risk Type, of which there are no
entrepreneur examples at all in our small sample. This
disparity is largely also responsible for differences in the
incidents of Composed Type - a trade off between opposite
sides of the compass. Perhaps the most unexpected
finding is that, as a group, the entrepreneurs buck their
popular stereotype, appearing to be significantly more
careful and organised (Prudent Type) as well as being less
gung-ho in their willingness to embrace new opportunities
fearlessly (Adventurous Type).

The points of greatest convergence between directors
and entrepreneurs are reflected in a similar incidence of
the Deliberate Type and the Spontaneous Type. These
are opposite Risk Types that, overall, seem to balance
each other out. This is also where both groups are least
differentiated from the wider population.
This, of course, is not a definitive study of either directors
or entrepreneurs. We justify its inclusion here because,
on a ‘within organisation’ basis, any development work
at board or senior manager level would be dealing with
small numbers. The ability of the Risk-Type CompassTM to
point out the kinds of distinction alluded to above are very
valuable in terms of self-awareness and team development.
As a further example, Figure 5 shows the positions of a
small group of directors on the Risk-Type CompassTM. The
clustering and dispersal of individuals illustrates the kind of
issues that might be experienced in terms of interpersonal
frustration. The alternative being that, properly addressed,
a more productive mutual respect and understanding of
these alternative perspectives can be facilitated.

Those at the top of the organisational hierarchy would
have the greatest influence on the general culture, and
that of course will include culture of risk. Whether or not
such people can be described as leaders or entrepreneurs
is debatable. This is dependent on why they are now
in a prominent position and how they got there. In
our consulting experience, in some very conservative
organisations, seniority still rules, often to the frustration
of younger talent whose prospects of advancement
may seem dauntingly distant! Nevertheless, whatever
their route to success, we compare here a group of
entrepreneurs with a group of company directors.

On the other hand, minimising IT risk in today’s cyber
economy is also a high priority. In their Harvard Business
Review article ‘Why Your IT Project May Be Riskier Than
You Thought’, Bent Flyvbjerg and Alexander Budzier (2011)
report recent research showing high numbers of out-ofcontrol IT projects that sink entire companies and careers.
New standards and regulations focus on operational
risk management – weighing risk against reward and
building systems and procedures designed to reduce
or eliminate risk. Thus, regulation and best practice
frameworks are also obviously important moderating
influences. The dilemma then, is that total elimination of
risk could also stifle innovation. It may therefore be of
critical importance to ascertain the optimal balance of
Risk Types amongst IT professionals.

19

15.00 PART 2: RESEARCH FINDINGS
10.00
5.00
0.00

CHART 11: Risk Types
in an ITPRUDENT
sample DELIBERATE
WARY
and general population
IT Professionals n=264, General Population n=2,000

COMPOSED ADVENTUROU

RISK TYPE

IT PROFESSIONALS

GENERAL POPULATION
The balance in our sample was clearly25.00
towards greater risk
taking. 21% are characterised as the Adventurous Type
IT PROFES
and both the Carefree and Composed20.00
Risk Types were also
strongly represented – all three types being associated with
GENERAL POP
15.00
high levels of risk tolerance and an appetite for risk taking.
These results characterise the IT profession as being
10.00
both impulsive, excitement seeking and daring but also
as calm, optimistic and resilient. Nevertheless,
the more
5.00
cautious Risk Types are also in evidence, but below their
prevalence in the wider population. 0.00
These participants,
WARYintense
PRUDENT
DELIBERATE COMPOSED ADVENTUROUS CAREFREE SPONTANEOUS INTENSE
who would probably come across as more edgy,
and pessimistic, are the worriers who would always stress
RISK TYPE
the need for caution. The question for hiring managers is
whether the right Risk Types are in the right IT jobs!
CHART 12: Risk Types in an IT sample

PERCENTAGE OF SAMPLE

Other research (e.g Lounsbury et al., 2009) also suggests
that there is a greater prevalence of more risk tolerant
individuals in the IT profession. This would reflect the
requirement of IT roles to cope in a continuously changing
industry and a sector that is characterised by new ideas,
less structured work environments and unconventionality.

Computer Weekly teamed up with Psychological
Consultancy Ltd to research IT professionals’ propensity
for risk taking and the online assessment was completed
by 264 Computer Weekly readers.

25.00

PERCENTAGE
PERCENTAGE
OF SAMPLEOF SAMPLE

“Our clients are driven by improving efficiencies and
driving down costs. Innovation is the thing that’s
making the difference. With innovation comes taking
risks. Clients are now hiring people who are expected
to take risks,” reports Rob Grimsey, group marketing
director at Harvey Nash.

20.00

and general population

IT PROFESSIONALS

GENERALn=2,000
POPULATION
IT Professionals n=264, General Population
IT PROFESSIONALS
IT PROFESSIONALS

GENERAL POPULATION

20.00
25.00

GENERAL POPULATION

15.00
20.00
10.00
15.00
5.00
10.00
0.00
5.00
0.00

WARY

PRUDENT

DELIBERATE

COMPOSED ADVENTUROUS

RISK TYPE

CAREFREE

SPONTANEOUS

INTENSE

ENGINEERS

PART 2: RESEARCH FINDINGS

GENERAL POPULATION

25.00

PERCENTAGE OF SAMPLE

20

20.00

ENGINEER SAMPLE
5.00

Our study of Risk Type in the engineering profession
shows a clear preference towards0.00 the Composed
WARY
PRUDENT
and Deliberate Risk Types, combining to account for
37% of the engineering sample. These Risk Types are
associated with a self-assured and relatively untroubled
approach to risk. The Composed Type made up the
majority of the sample (21%) and is associated with
high levels of risk tolerance, whereby individuals tend to
maintain a calm and positive outlook despite difficulties
and setbacks. The Deliberate Type (16%) differentiates
from the Composed Type particularly in their focus on
being thorough, prepared and well organised in their
investigations and problem solving. The least prevalent
Risk Types found amongst the engineering sample were
the Carefree and Spontaneous Risk Types, which may be
more unpredictable, unconventional and inclined to act
on impulse. They may be considered either creative and
ingenious or challenging and unconventional, depending
on their suitability for their role.

ENGINEERS
These results are generally
in line with the assumption
GENERAL POPULATION
that engineers need the ‘can do’ temperament to confront
and deal with the challenges that arise, whilst needing to
be systematic in the search for optimal solutions. From
the personality
CAREFREE
SPONTANEOUS point
INTENSEof view, these findings emphasise
the value of engineers being calm, methodical and
resilient decision makers.

ENGINEERS

CHART 13: Risk Types in an engineering
GENERAL POPULATION
DELIBERATE COMPOSED ADVENTUROUS CAREFREE SPONTANEOUS INTENSE
sample and general population
RISK TYPE
Engineers n=92, General Population n=2,000
ENGINEERS
GENERAL POPULATION

The sheer scope and diversity of engineering makes
generalisation about Risk Type difficult. It is a profession
in which challenges range from the nuclear industry to
ship building and from aerospace to road construction.
Nevertheless, all of the engineering specialisms have to
deal with risk and to make decisions about tolerances and
safety margins. Failures do happen and, when engineers
fail, the social and economic costs can be very high.

10.00

“There will always be failures or disasters as engineers
and 5.00
designers push the boundaries25.00
by building taller
buildings, longer bridges, or by reaching
further into
20.00
space.
0.00Each time there is a failure or disaster, changes are
15.00
made and regulations
introduced
only toCOMPOSED
be outstripped
WARY
PRUDENT
DELIBERATE
ADVENTUROUS
10.00
by further developments.” (Nick Spurrier, 2009)
RISK TYPE
PERCENTAGE OF SAMPLE

The engineering profession recognises that risk is
inherent in the activities undertaken by its members.
Engineers are tasked with solving real world problems as
they arise and the solution to these problems must often
satisfy conflicting requirements; efficiency and improved
performance might come at a greater cost; safety might
add to complexity and take up more time. The optimal
engineering solution is the one that considers all such
conflicting requirements and this will largely depend on
the engineer’s analysis of the level of risk involved.

15.00

ENGINEERS

20.00

GENERAL POPULATION

25.00
15.00
20.00
10.00
15.00
5.00
10.00
0.00
5.00

WARY

PRUDENT

DELIBERATE

COMPOSED ADVENTUROUS

CAREFREE

SPONTANEOUS

INTENSE

CAREFREE

SPONTANEOUS

INTENSE

RISK TYPE
0.00
WARY

PRUDENT

DELIBERATE

COMPOSED ADVENTUROUS

GENERA

PERCENTAGE OF

10.00

5.00

15.00
10.00

0.00

RECRUITER SAMPLE
0.00

WARY

The role of the recruiter has become increasingly
complex. There is a requirement to develop expertise
across the many facets of recruitment, such as the high
technology of IT or the sophistication of the Finance
sector, as well as the dramatic impact of internet based
innovation on recruitment practices.
Recruitment requires the ability to be proactive, resilient
and to persevere despite the frequent setbacks. While
the core element of the recruitment industry is sales and
profit, the industry deviates from traditional sales roles
in terms of the amount of risk involved. While traditional
sales roles involve finding a match between a customer
and a product, the need for the recruitment consultant to
establish a match acceptable to both parties effectively
doubles the risk of failing to secure a placement.
We anticipated that recruiters would have a distinctive risk
profile, with a higher proportion of recruiters compared to
the general population being in the higher risk tolerant
types such as Adventurous, Composed and Carefree.
Results indicate that this was the case. The most
frequently occurring Risk Types amongst the recruiter
sample are at the most risk tolerant side of the Risk-Type
CompassTM. The proportion of these Risk Types compared
to the general population is striking. The epicentre of the
approach to risk amongst our sample of recruiters is
captured by the following Carefree Risk Type description:

21

PART 2: RESEARCH FINDINGS

5.00

WARY

PRUDENT

PRUDENT

DELIBERATE

DELIBERATE

COMPOSED ADVENTUROUS

CAREFREE

COMPOSED ADVENTUROUS

SPONTANEOUS

CAREFREE

INTENSE

SPONTANEOUS

INTENSE

RISK TYPE

RISK TYPE

At the root of this Risk Type are high levels of
spontaneity, challenge to convention and a preference
for novelty and excitement over routine. The most
extreme examples are likely to opt for variety over
consistency, excitement over caution, action over
planning and individuality over conformity. They feel
constrained by petty rules, traditions or being micromanaged. Although not naturally methodical or
attentive to detail, this type will provide a challenge to
dogma and relish opportunities to break new ground.

CHART 15: Risk Types in a recruiter sample
and general population
Recruiter n=141, General Population n=2,000
RECRUITER
GENERAL POPULATION

RECRUIT

GENERAL POPULAT

In fact this picture has to be moderated by a strong
Adventurous Type influence, which implies high levels
of composure, resilience and optimism. Of course, in a
sample that has many different levels and specialisms,
this will be something of a caricature. All of the Risk Types
are in fact represented to some degree but the overall
results of this survey are nevertheless very distinctive.

CHART 16: Risk Types in a recruiter sample
and general population
Recruiter n=141, General Population n=2,000
30.00
RECRUITER
GENERAL POPULATION

25.00

PERCENTAGE OF SAMPLE

PERCENTAGE

15.00

20.00
15.00
10.00
5.00
0.00
WARY

PRUDENT

DELIBERATE

COMPOSED ADVENTUROUS

RISK TYPE

CAREFREE

SPONTANEOUS

INTENSE

PERCE

10.00
0.00

PART 2: RESEARCH FINDINGS

WARY

PRUDENT

DELIBERATE

COMPOSED ADVENTUROUS

CAREFREE

SPONTANEOUS

INTENSE

AUDITORS

RISK TYPE

GENERAL POPULATION

AUDITOR SAMPLE

WARY

Auditors are required to look for risks, assess their
likelihood of occurrence and the severity of the risk, in
the event that the risk is realised (Holtmann, 2011). The
main risk for individuals in this sector is that an incorrect
or incomplete audit has a direct impact on the audited
organisation. It can result in financial mismanagement,
breaches in health and safety regulations or costly
product recalls. The emphasis on prudence and attention
to detail suggested that, for those working in audit roles,
the more apprehensive, careful and cautious Risk Types
would be most prevalent.

4.55%

The data shows a very distinctive distribution
of10.10.13%
Risk
PRUDENT
Types in the research sample. 69% of DELIBERATE
the participating
37.37%
AUDITORS
auditors grouped in a cluster of three COMPOSED
Risk Types.
The
21.72%
GENERAL POPULATION
highest proportion of individuals are designated as the
9.60%
ADVENTUROUS
Deliberate type (37%), described as being “rooted
1.01%
CAREFREE
in a high level of calm self-confidence combined
4.55%
SPONTANEOUS
with detailed preparation and planning”, with the
3.03%
INTENSE
second most common being the Composed Type (22%)
having “high levels of poise, self-belief, optimism
and resilience and being imperturbable and eventempered”. There are far fewer individuals at the Intense
PRUDENT
DELIBERATE COMPOSEDRisk
ADVENTUROUS
INTENSE
and Spontaneous
TypesCAREFREE
end ofSPONTANEOUS
the spectrum,
and a
RISK TYPE
mere 1% designated
as the Carefree Risk Type.

CHART 17: Risk Types in an auditor sample
and general population
Auditors n=198, General Population n=2,000
AUDITORS
GENERAL POPULATION

AUDITORS
GENERAL POPULATION

Chart 17 illustrates the strong ‘pull’ of the calm and
organised side of the compass in our auditor sample.
The difference in prevalence between the Deliberate
Risk Types in the sample in comparison to the general
4.55%
WARY
population (almost x 4) is quite remarkable, as is the
10.10.13%
PRUDENT
greater proportion of the Composed Type. Taken
37.37%
DELIBERATE
alongside the lower incidence of the Wary, Carefree,
21.72%
COMPOSED
Spontaneous and Intense Types, this is a very distinctive
9.60%
ADVENTUROUS
AUDITORS
professional profile.
CAREFREE
40.00

PERCENTAGE OF SAMPLE

PERCENTAGE OF SAMPLE

This survey was carried out in conjunction with RABQSA,
sampling auditors in Canada, the USA and Australia.
RABQSA is an internationally recognised personnel
and training certification body for auditors in a range of
disciplines and industries, including Quality, Environment,
40.00
Occupational Health and Safety, and Food Safety. Here
30.00
we aimed to identify any systematic patterns
in the risk
disposition of survey participants. Although
20.00there are
many specialisms across the auditing professions, we
10.00
hypothesised that a common need for care and
vigilance
would generalise throughout the group.
0.00

WARY

1.01%

SPONTANEOUS

4.55%

INTENSE

3.03%

10.00

AUDITORS

GENERAL POPULATION

AUDITORS

40.00

GENERAL POPULATION

30.00
20.00

CHART 18: Risk Types in an auditor sample
and general population
Auditors n=198, General Population n=2,000

PERCENTAGE OF SAMPLE

22

0.00

GENERAL POPULATION

30.00
20.00
10.00
0.00

WARY

PRUDENT

DELIBERATE

COMPOSED ADVENTUROUS

CAREFREE

SPONTANEOUS

INTENSE

WARY

RISK TYPE

PRUDENT

DELIBERATE

AUDITORS

COMPOSED ADVENTUROUS
GENERAL POPULATION

RISK TYPE

WARY
PRUDENT
DELIBERATE

4.55%
10.10.13%
37.37%

CAREFREE

SPONTANEOUS

INTENSE

Great deeds
are usually
wrought at
great risks
HERODOTUS

Part 3:

USE OF THE
RISK TYPE
COMPASS
TM

24

PART 3: USE OF THE RISK-TYPE COMPASS TM

USE OF THE RISK-TYPE COMPASS
The Risk-Type CompassTM can be utilised
throughout an organisation, from individual to
team level, concerning surveys of organisational
risk landscape and organisational culture.
INDIVIDUAL LEVEL
Selection
Different Risk Types will have implications for different job
roles within an organisation. The Risk-Type CompassTM
adds a further dimension to existing selection procedures,
better informing vital employee appointment decisions.
For example, compliance officers will require a very
different approach to risk taking than traders.
Re-deployment
This psychometric tool can be used to inform staff
retention; valued employees can be re-deployed into
roles better suited to their risk taking disposition.
Personal development
An individual’s awareness and knowledge of their own
disposition towards risk can provide a basis for personal
development. Coaching can help an individual to better
understand their own propensity towards risk and its
implications for behaviour, management style and
impact on the expectations of others.

Advising in financial services
In the financial adviser context, the Risk-Type CompassTM
may be used to assess a client’s propensity for risk.
It offers a truly tailored and professional approach to
discussion about the levels of risk individuals are able
to cope with, providing a basis of trust on which to build
longstanding and fruitful client relationships.

TEAM LEVEL
The Risk-Type CompassTM can increase understanding
of team dynamics through awareness of one’s own
propensity for risk and that of other team members. This
can shed light on previously misunderstood differences
and enhance team decision-making, team development
processes, and increase cohesion and effectiveness.
It can also highlight the composition of teams and aid
the development of a suitable balance in the risk taking
tendencies of team members.

TM

ORGANISATION LEVEL
In survey mode, the Risk-Type CompassTM provides an
overview of the risk landscape of an organisation and the
prevailing risk culture.
Risk culture
The risk culture of an organisation reflects the human
values, style and behaviours prominent amongst current
staff (particularly of senior staff) and the legacy of their
predecessors. Survey data from the Risk-Type CompassTM
provides objective measures through which to shape,
foster and monitor the risk culture and manage change.
Risk landscape
What risk taking tendencies are most prevalent in a
department? Where are there concentrations of particular
Risk Types? Are they appropriate for the functioning of
that department? Is there a balance between risk takers
and more reticent and considered decision makers? The
Risk-Type CompassTM illuminates such distinctions and
makes them manageable.

Part 4:

CONCLUSION
Human Factor Risk has attracted a lot of
thought and speculation, (a) because the
human and financial costs of unmanaged
risk are considerable and solutions are
desperately needed, and (b) because answers
so far have been largely unconvincing.
The conceptual territory surrounding Human Factor Risk
has become very confused. As a consequence there
has been little consensus about assessment and no
consistency in professional practice. The task, as we see
it, is to progressively disentangle the many elements that
can influence risk taking.
A major difficulty arises from the use of poorly defined
lay terminology that creates more confusion than clarity.
Terms such as ‘attitudes’, ‘beliefs’, ‘preferences’,
‘motives’, ‘drives’, ‘dispositions’, ‘needs’, ‘values’,
’interests’ are all complex, nuanced and open to a
wide range of interpretation. Unless carefully qualified,
such distinctions are largely a matter of semantics and
personal choice, creating a conceptual and semantic fog
around Human Factor Risk.

In contrast, there is a very extensive history of scientific
personality research, culminating in a consensual and
clearly defined model. The Five Factor Model (FFM)
is the essential paradigm for current mainstream
personality research.
Since the tendency to be, for example, fearful, cautious,
excitement seeking or impulsive are all understood
personality characteristics, it is clear that personality has
a crucial influence on how much risk we take, how we
perceive risk, how we cope with uncertainty and how we
react to threat or disappointment.
Freud described human behaviour as ‘over determined’:
influenced by many factors. Similarly, risk taking may
be influenced by more or less random complexities.
So, there will always be things that we might not know
for certain about a particular risk incident. However, we
can know to what extent someone’s personality would
influence their readiness to take risks. This will have an
important and pervasive influence on their behaviour and,
cumulatively, on the culture of groups and organisations.
This is what the Risk-Type CompassTM is designed
to assess.

No noble thing
can be done
without risks
MICHEL DE MONTAIGNE

26

ABOUT PCL

ABOUT PCL
Since 1992, PCL has provided an energetic and
revitalising influence in the business psychology
sector. Impatient to see the clear messages from
research impact on the often dated and unduly
conservative practices then prevalent, PCL has been
enthusiastically ‘rattling the cage’ with world class
ideas and innovations, seeking to change the agenda
and to establish a new and purposeful edge in terms
of professional practices and the tools needed to
implement them.
In 1992, none of the top five most popular assessment
tools used to assess personality in the UK bore any
relationship to contemporary personality research.
Dr. Robert Hogan’s mission, to reunite assessment
practices with personality research, still underpins
PCL’s professional vision.

PCL’s publication of the UK’s first FFM personality
questionnaire in 1997 in the form of the UK edition
of the Hogan Personality Inventory (HPI) triggered
an exciting period of innovation. Our UK editions of
the Motives, Values and Preferences Inventory (MVPI)
and the Hogan Development Survey (HDS) followed in
1998. In 1999, PCL was the first UK test publisher to
take the initiative by putting personality questionnaires
online through the original PsyKey platform.
Having been developed from the challenges faced by
our clients, Columbus Wealth Management, the RiskType CompassTM is in line with other tools initiated
directly through our consultancy work across different
industries and sectors. Now, based on the fourth
iteration of the PsyKey platform, PROFILE:MATCH® and
the Risk-Type CompassTM continue the PCL tradition
of well researched, high utility online assessment tools.